The Victorian State Government’s policy to cap the rates of local government has cost the Victorian economy 7,425 direct and indirect jobs in 2021-22, and has reduced GDP by up to $890 million in 2021-22, according to new research from the Australia Institute’s Centre for Future Work.
Key Findings:
- The rate caps have reduced employment in Victoria by up to 7,425 jobs in 2021-22 and reduced GDP by up to $890 million
- The local government sector in Victoria employs about 50,000 people in road maintenance, aged care, waste disposal, libraries, childcare, and more
- The rate cap policy becomes more restrictive as the overall economy slows
- In 2021, the proportion of government-subsidised VET students studying with TAFE fell to a historic low
“Rate caps are an arbitrary policy which ties growth in overall rates revenue to price indexes which have nothing to do with demand for services or democratic accountability,” said Dan Nahum, economist at the Australia Institute’s Centre for Future Work.